While mobility has already become established as a true business benefit, the market is still very immature. Some developments we can expect to see in the years ahead are considered.
Mobile versus Fixed
A major battle on the road to true mobility will take place between the fixed voice and the mobile voice markets. Some countries have already fought this battle and are recording mobile:fixed ratios as high as 80:20. In other countries, well over 50 per cent of all calls take place on mobile networks, while in Australia and New Zealand this is still under 30 per cent. If the call charges are right, however, people prefer to use their mobile rather than fixed line phones. With high levels of market saturation, mobile companies have to grow their business by poaching - either from each other or from the fixed voice market. In this battle the mobile operator's only hope is to poach enough business from others to maintain their current levels of Average Revenue Per User (ARPU).
Mobile versus Wireless
After the fixed versus mobile developments, the next scenario will be a market split within the mobility industry. By 2015, the current 90:10 split between voice and data will be reversed with only 10 per cent of revenues coming from voice (VoIP).
With the emphasis on wireless data/broadband, infrastructure dedicated to such an environment will be needed. The current mobile communications infrastructure has been optimised for voice and is not well suited for the mobility market.
There are three key mobility scenarios: • WiMAX is a dedicated wireless broadband infrastructure and, if it delivers on its promise, could be the most cost-effective structure for this purpose. • Another possible scenario is the merger between 4G and wireless broadband. • Mobile vendors, however, believe that they will be able to turn their mobile networks around so that they can be used for wireless broadband. Companies are taking very strong positions for and against these developments in order to protect their vested interests.
To move forward, the mobile market needs to reconstruct itself and move into what is called the broadband mobility market, which can be described as a communication market that provides broadband services for people on the move. Typical services will include: • Podcasting; • Travelling video services; • Personal video communications; • Games and entertainment tailor made for the mobile platform; • Access to personal files (personal, hobby, business); • Adult services; • Information and news services. Most of these applications are not necessarily new; but the current business models and technologies have so far not been well-suited to them.
Customers like to use mobile content and services and there are plenty of media, content and services companies willing to utilise the network to distribute their products and services, and to participate in the cost of providing these services - but not at the currently uneconomically unviable business models used by the network operators, according to which they must give them 50 per cent of their revenues.
4G around the corner?
While parts of the mobile industry have proclaimed that 4G isn't required until 2012-2015 due to High-Speed Downlink Packet Access (HSDPA), it has been determined:
• 3G is too little, too late and is not going to drive the wireless broadband market;
• Either 4G or WiMAX, or a combination of the two, is needed for that next step;
• The mobile industry is very powerful and it has the networks, customers and billing infrastructure in place;
• Fourth-generation networks are already being planned by five of the world's largest cellular network operators - KPN Mobile, Orange, Sprint Nextel, TMobile and Vodafone;
• Transitions are being developed from both 2G and 3G, foreshadowing that some operators could skip 3G altogether and move straight into 4G. With less than 3 per cent of mobile revenues coming from true mobile data, the market cannot stay the same for the next 5-8 years. By 2015, close to 100 per cent of mobile revenues will be derived from wireless broadband.